Media and Earnings Management

Abstract

This study examines the influence of media appearance of firms on earnings management strategies of 632 firms listed on the London Stock Exchange during the financial crisis period. We find that firms that appear frequently on media are more likely to engage in earnings management activities. In addition, during the financial crisis firms with higher media attention do more real earnings management. The findings of the study contribute to the academic literature related to earnings management, firms’ media attention and financial crisis. Moreover, the findings are advantageous to investors, regulatory authorities and corporate managers, who are concerned about firms’ earnings management strategies that affect firms’ financial performance negatively.